Sanlam Enters Rwandan Market with Acquisition of Majority Stake in Soras Group

By Pearl Majola, 2 June 2014

Sanlam Emerging Markets (SEM) is pleased to announce that it has concluded an agreement to acquire a 63% interest in Soras Group Limited, Rwanda’s largest life and non-life insurance company for USD 24,3 million (or approximately ZAR 254 million at current exchange rates).

SEM is the cluster within the Sanlam Group tasked with expansion into international emerging markets. SEM already has operations in 10 countries on the African continent, excluding South Africa.

The transaction will see Sanlam doing business directly for the first time in Rwanda, which has one of the fastest growing economies on the continent. The country’s average real growth rate was 8.2% per annum from 2000 to 2012 and its GDP is approximately USD 7 billion.

Says SEM’s Chief Executive Officer, Mr Heinie Werth: “We are pleased to partner with the Soras Group, which is a well-established and well-performing business with about 30 years of market experience. The Soras Group has a sound and experienced management team and it boasts the market leading position in insurance in Rwanda. This transaction will support our efforts to consolidate and entrench Sanlam’s position on the continent in general and East Africa in particular.

“Rwanda is an attractive market because of the low insurance penetration rate and the country’s economic growth prospects. We believe Sanlam has the requisite technical expertise and experience which will add value to the business.”

As at 31 December 2013, the Sanlam Group had unallocated discretionary capital of R4 billion. A substantial portion of this would be earmarked for expansion in Africa, India and South-East Asia, in line with one of the key strategic objectives which is to grow in selected emerging markets. The Group reiterated that Africa remains one of its key investment destinations.

The Kigali-based Soras Group was established in 1984 and has over the years maintained a strong growth record, a strong brand and a well-established local management team led by founder and remaining anchor minority shareholder, Mr Charles Mporanyi.

Commenting on the transaction, Mr Mporanyi says: “This transaction is part of Soras Group’s development strategy. Our vision leads us to partner with a large international company such as the Sanlam Group for the best benefit of the shareholders of Soras, its customers, its staff and the economy of Rwanda.”

Mr Werth concluded: “We believe this transaction is yet another highlight in our progress in emerging markets and we hope to draw from our experience of working with other partners on the continent to build a strong and mutually beneficial partnership with the Soras Group.”